De-merger: Helping a management team take their advice business out of a larger firm

Requirement:

Partner A is the advice division of an accountancy practice. It’s owned by the accountancy partners who have little interest in its development. Accordingly, while the advice business is successful, it hasn’t been achieving its full potential. The management team on the advice side ask us to:

• buy out the shares owned by the accountancy partners;
• provide some capital for an acquisition;
• help them gain equity in the business.

Solution:

We provide our partner with:

• equity funding to exit the accountancy partnership;
• both debt and equity funding to acquire another local advisory business;
• We also help them purchase more shares for themselves in the process.

However, we do much more.

We also:

• support changes to their management structure by providing specialist resources, allowing them to scale up and recruit more advisers at relatively minimal cost;
• assist with the financial and commercial due diligence required for their acquisition;
• implement a management incentive plan to bring them more shares over time.

At the end of this process, they can also report and forecast more accurately, which streamlines the process should they wish to make further acquisitions. The outcome is a more effective platform for future growth, with a highly motivated and incentivised management team.